Sherry Long v. State of Delaware ( 2016 )

IN THE COURT OF COMMON PLEAS FOR THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
SHERRY LONG, )
)
Defendant-Below/Appellant, )
)
v. ) C.A. No. CPU4-16-000917
)
STATE OF DELAWARE, )
)
Plaintiff-Below/Appellee. )
)
Submitted: October 21, 2016
Decided: December 13, 2016
Sherry Long Victoria Counihan, Esq.
321 Wooddale Avenue Department of Justice
New Castle, DE 19720 820 North French Street
Self-Represented Appellant Wilmington, DE 19801
Attorney for Appellee
MEMORANDUM OPINION AND ORDER
ON APPELLEE’S MOTION FOR SUMMARY JUDGMENT
This is an appeal from a decision by the Justice of the Peace Court No. 13
finding in favor of Plaintiff-Below/Appellee State of Delaware Benefit Payment
Control Unit (the “Division”1), of the Department of Labor’s Division of
Unemployment Insurance. The Division brings this Motion for Summary Judgment
(the “Motion”) pursuant to Court of Common Pleas Civil Rule 56. A hearing on the
1 The Division is the agency responsible for maintaining the solvency of Delaware’s Unemployment Compensation
Administration Fund, which provides wage earners who become unemployed through no fault of their own with
unemployment benefits until they re-enter the labor market.
Motion was held on September 2, 2016. During the hearing, the question surfaced of
whether the Court has jurisdiction in this matter. Specifically, the Court questioned
whether it could issue an order for the collection of a debt based upon a decision by
the Unemployment Insurance Appeals Board. At the conclusion of the hearing, the
Court ordered the parties to submit supplemental briefing on the issue of jurisdiction.
The Division complied with the Court’s briefing order; however, Sherry Long
(“Defendant”) failed to submit any additional material. This is the Court’s decision
on the Motion.
FACTUAL AND PROCEDURAL HISTORY
Defendant filed a claim for unemployment insurance benefits with the
Division, effective February 5, 2012, and began receiving benefits in the amount of
$281.00 per week. After receiving these benefits for six months, Defendant applied
for an extension, which became effective on August 5, 2012, and again began
receiving benefits in the amount of $281.00 per week. Defendant continued to
receive the extension weekly benefits from August 11, 2012 through December 29,
2012.
On January 23, 2013, the Division issued a Notice of Determination finding
that Defendant had been disqualified from receiving unemployment insurance
benefits as of April 21, 2012 (the “Disqualification Determination”). The notice
stated that an overpayment would be established, and Defendant had a right to appeal
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the Disqualification Determination. Defendant did not pursue an appeal, and the
Disqualification Determination became final on February 2, 2013.
On March 1, 2013, the Division issued two notices determining Defendant had
been overpaid unemployment insurance benefits for which she was later found to be
disqualified (the “Overpayment Determinations”). The Overpayment Determinations
found that Defendant had been overpaid unemployment benefits in the amount of
$4,496.00 from April 21, 2012 to August 4, 2012; and $5,620.00 from August 11, 2012
to December 29, 2012. Defendant appealed both Overpayment Determinations to an
Appeals Referee. After a hearing on the merits, the Appeals Referee upheld both of
the Overpayment Determinations.
On April 15, 2013, Defendant appealed the Appeals Referee’s decision to the
Unemployment Insurance Appeals Board (the “Board”). The Board affirmed the
Appeals Referee’s decision, and found Defendant liable for the overpayments of
unemployment benefits. On May 8, 2013, Defendant appealed the Board’s decision
to the Superior Court; however, the Superior Court dismissed the action on October
3, 2013 because Defendant failed to prosecute the appeal. Accordingly, the Board’s
decision upholding the Overpayment Determinations became a final administrative
order.
Pursuant to the authority in 19 Del. C. § 3325 and 30 Del. C. § 545, the Division
began collection proceedings of the amounts owed by withholding a portion of
Defendant’s future unemployment benefits and by intercepting Defendant’s tax
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refunds. The Division was able to recoup $1,367.00 from Defendant using these
methods. Defendant currently owes the Division $8,875.50 in unemployment
benefits overpayments.
On October 22, 2015, the Division brought a debt action against Defendant
in Justice of the Peace Court No. 13, to recover the amounts due from overpayments.
On March 8, 2016, Defendant filed a counterclaim in the amount of $1,368.00,
seeking recovery of reductions in unemployment benefit payments the Division
withheld. The Justice of the Peace Court held a trial on March 9, 2016, and entered
judgment in favor of the Division in the amount of $8,829.00 plus costs. On March
24, 2016, Defendant filed an appeal to this Court.
The Division filed the instant Motion for Summary Judgment on August 9,
2016. The Court conducted a hearing on the Motion on September 2, 2016, where
the jurisdiction issue surfaced. The question centered upon the Court’s authority to
hear an action where the claim arose out of and is based upon an administrative
decision by the Board to collect overpayment benefits. The Court allowed the parties
to submit supplemental briefs on the issue of jurisdiction, and reserved decision on
the Motion. On September 30, 2016, the Division filed its Opening Brief on the issue
of jurisdiction. Although Defendant was afforded the opportunity to address the
issue of jurisdiction, Defendant did not file a Response.
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PARTIES’ CONTENTIONS
The Division contends that this Court has jurisdiction to hear this debt action
and issue a judgment based upon a decision by the Board. In support of its position,
the Division argues the Court has jurisdiction under the plain meaning of the
unambiguous statute codified in 19 Del. C. § 3325. The Division argues that under
section 3325, the Division may collect an overpayment of unemployment benefits by
bringing a “civil action in a court of competent jurisdiction.” The Division contends
that based upon principles of statutory construction and case law construing sections
of the Delaware Code, the Court has jurisdiction to hear this action to collect a debt
overpayment owed to a state agency.
Moreover, the Division references other sections of Title 19 which require
appeals to be filed exclusively with the Superior Court. The Division argues the
General Assembly never intended Section 3325 actions for the collection of
overpayment debts to be filed exclusively in the Superior Court, but instead in any
“court of competent jurisdiction.” The Division maintains if the legislature meant for
these cases to be heard exclusively in Superior Court, it would have so specified in the
statute. The Division maintains the plain language of the statute is evidence of the
legislature’s intent to allow the Division to file actions, such as this one, in any court
that hears civil actions, subject to the limitations of amounts in controversy.
Furthermore, the Division contends that the Delaware Administrative Procedures
Act (the “APA”) does not apply in this case, because the APA does not apply to
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decisions of either the Division or the Board. The Division acknowledges that
appeals from case decisions made by State agencies and boards must be filed with the
Superior Court pursuant to the APA. However, the Division contends the instant
action is not an appeal of an agency decision, but rather a separate action to collect
debts owed as a result of a final, and no longer appealable, agency decision.
Therefore, the State reasons that since the APA does not confer jurisdiction in debt
matters, the Court must look to the Delaware Code and the Delaware Constitution to
determine whether it has subject matter jurisdiction.
With respect to this Court, the Division notes that the Delaware Constitution
grants the Court of Common Pleas jurisdiction over all civil actions at law where the
matter or thing in controversy does not exceed $50,000. The Division argues that the
instant matter, which is a civil action at law seeking to collect a debt owed to a state
agency in an amount less than $50,000, falls squarely within this Court’s jurisdiction.
Furthermore, the Division maintains that the Justice of the Peace Court had
jurisdiction to hear this matter, because the amount in controversy did not exceed the
court’s $15,000 jurisdictional limit. For these reasons, it is the Division’s position that
not only does the Superior Court have jurisdiction to hear this matter, but also the
Justice of the Peace Court and the Court of Common Pleas, because they are all
courts of competent jurisdiction with an amount in controversy not in excess of their
constitutional limits.
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Because this Court has jurisdiction to hear the appeal, the Division argues this
Court must grant its Motion for Summary Judgment. The Division maintains that
there are no issues of genuine material facts. The Division asserts that the Board’s
ruling affirming the Overpayment Determinations is a final administrative order,
which is not reviewable by this Court. The Division argues Defendant’s sole remedy
to challenge the Board’s decision was to pursue an appeal with the Superior Court,
which process Defendant began, but did not continue to pursue. This led to the
Superior Court dismissing Defendant’s appeal, and the Board’s decision became a
final order. As a result, the Division argues that Defendant is required by law to repay
the outstanding principal balance owed to the Division with interest and court costs.
Although Defendant did not provide this Court with a response on the issue of
jurisdiction, Defendant does vehemently oppose the Division’s Motion. However,
Defendant’s opposition is based upon her not being afforded the opportunity to
argue her case before the Justice of the Peace Court. Specifically, Defendant claims
she was not able to argue the issue of disqualification of benefits pursuant to 19 Del.
C. § 3314(1). For these reasons, Defendant implores this Court to deny the Division’s
Motion, and allow her a chance to present her position at trial.
LEGAL STANDARD
Court of Common Pleas Civil Rule 56(c) provides that “[t]he judgment shall be
rendered forthwith if the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, show that there is no genuine
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issue of material fact and that the moving party is entitled to judgment as a matter of
law.”2 If the record reveals that material facts are in dispute, or if the factual record
has not been developed thoroughly enough to allow the Court to apply the law to the
factual record sub judice, then summary judgment must be denied. 3
“In considering a motion for summary judgment the court must view the facts
in a light favorable to the non-moving party and accept, as true, all undisputed factual
assertions.”4 This Court will grant a motion for summary judgment when there is no
genuine issue of material fact, and the moving party is entitled to judgment as a matter
of law.5 However, a motion for summary judgment will be denied when “a more
thorough inquiry into the facts is desirable to clarify the application of the law to the
circumstances.”6
DISCUSSION
I. Jurisdiction
Before the Court can address the Division’s Motion, it first must decide the
threshold question of jurisdiction. As a preliminary matter, I agree with the Division
that the APA does not apply in this case. The instant matter before the Court is not a
review of an agency decision, but rather a debt collection action. For this reason, the
Court must look to the Delaware Code for guidance.
2 CCP Civ. R. 56(c).
3 See Ebersole v. Lowengrub, 180 A.2d 467 (Del. 1962).
4 Donnelly v. Fannie Mae, 2015 WL 6739163, at *2 (Del. Com. Pl. Nov. 3, 2015) (internal citations omitted).
5 See Id.6 Id.8
The recoupment of overpayment of benefits is governed by 19 Del. C. § 3325.
The statute is explicit on how the Division may recoup the overpayment of
unemployment benefits, including the requirement that the Division issue notices of
overpayment prior to any collection action. The statute is also clear that the judicial
appeal process to dispute a decision of overpayment, is exclusively vested in the
Superior Court. However, the statute generally vests jurisdiction for collection action
following the Board’s final determination.
A pertinent part of Section 3325 states:
No action shall be taken by the Department to collect an overpayment
of benefits to any person after a period of 5 years from the end of the
benefit year, as defined in § 3302(3) of this title, with respect to which
such benefits were paid, unless during this 5 year period, the Department
has brought a civil action in a court of competent jurisdiction against the claimant.7
Furthermore, the first paragraph of Section 3325 states:
In addition to the methods of collection authorized by this chapter, the
Department may collect overpayments, interest, penalties, and other
liabilities due under this chapter as provided in § 545, Title 30 of the
Delaware Code, § 5402 of the Federal Internal Revenue Code (26 U.S.C.
§ 5402), § 503(m) of the Social Security Act (42 U.S.C. § 503(m)), and any
other means available under Federal or State law.8
Delaware law grants this Court jurisdiction over all civil actions at law where
the matter or thing in controversy does not exceed $50,000.9 A debt action based
upon amounts a party claims or a certain sum of money due to him or her comes
7 19 Del. C. § 3325 (emphasis added).
8 Id (emphasis added).
9 10 Del. C. § 1322.
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within this jurisdiction.10 One of the most common instances of its use is for debts
based upon judgments or obligations of record.11
The basic rule of statutory construction requires the Court to ascertain and
give effect to the intent of the legislature.12 “If the statute as a whole is unambiguous
and there is no reasonable doubt as to the meaning of the words used, the court's role
is limited to an application of the literal meaning of those words.”13 The plain reading
of Section 3325 allows the Division to collect overpayments by any means available
under State law. This includes bringing debt collection actions based upon judgments
or obligations of record. The Division brought a debt action against Defendant in the
Justice of the Peace Court to recover the overpayment of benefits based upon a final
administrative order. The amount the Division sought to recover was under $15,000.
Therefore, the Justice of the Peace Court had jurisdiction over this matter. This
Court has jurisdiction to hear civil appeals from the Justice of the Peace Court, and
therefore this matter is properly before the Court.
II. Motion for Summary Judgment
Turning to the Motion before the Court, having resolved the jurisdiction issue,
the record reflects that the Board’s decision regarding the overpayment of benefits
became a final order upon dismissal by the Superior Court. Pursuant to Section 3325,
10 Benjamin J. Shipman, Handbook of Common-Law Pleading § 52, at 132 (Henry Winthrop Ballantine ed., 3d. 1923).
11 Id.
12 See Coastal Barge Corp. v. Coastal Zone Indus. Control Bd., Del.Supr., 492 A.2d 1242, 1246 (1985).
13 In re Adoption of Swanson, 623 A.2d 1095, 1096–97 (Del. 1993).
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Defendant’s sole remedy to dispute the Board’s decision is an appeal to the Superior
Court,14 which she commenced but ultimately failed to pursue. This resulted in the
Superior Court dismissing her appeal, making the Board’s decision final. There are no
genuine issues of material fact that are in dispute regarding the state’s right to collect
the debt. Accordingly, summary judgment is appropriate under Court of Common Pleas
Civil Rule 56, and the Division’s Motion is GRANTED.
CONCLUSION
For the reasons stated supra, the Division’s Motion for Summary Judgment is
hereby GRANTED. Defendant’s counterclaim seeking the recovery of reductions in
unemployment benefit payments the Division withheld is hereby DENIED.
Judgment is entered in favor of the Division in the principal amount of $8,829.00,
with post-judgment interest at the contractual rate of 18% and costs.
IT IS SO ORDERED.
_________________________________
Alex J. Smalls,
Chief Judge
Sherry Long-OP Dec 13 2016
14 19 Del. C. §3325.
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